diff --git a/reactive/kotlinx-coroutines-rx2/src/RxConvert.kt b/reactive/kotlinx-coroutines-rx2/src/RxConvert.kt
index cf73ef2ea8..abd13b9ed4 100644
--- a/reactive/kotlinx-coroutines-rx2/src/RxConvert.kt
+++ b/reactive/kotlinx-coroutines-rx2/src/RxConvert.kt
@@ -81,7 +81,12 @@ public fun <T: Any> ObservableSource<T>.asFlow(): Flow<T> = callbackFlow {
     val observer = object : Observer<T> {
         override fun onComplete() { close() }
         override fun onSubscribe(d: Disposable) { if (!disposableRef.compareAndSet(null, d)) d.dispose() }
-        override fun onNext(t: T) { sendBlocking(t) }
+        override fun onNext(t: T) {
+            try {
+                sendBlocking(t)
+            } catch (ignored: Throwable) { //TODO: Replace when this issue is fixed: https://github.com/Kotlin/kotlinx.coroutines/issues/974
+            }
+        }
         override fun onError(e: Throwable) { close(e) }
     }
 
diff --git a/reactive/kotlinx-coroutines-rx2/test/ObservableSourceAsFlowStressTest.kt b/reactive/kotlinx-coroutines-rx2/test/ObservableSourceAsFlowStressTest.kt
new file mode 100644
index 0000000000..b187ab9b63
--- /dev/null
+++ b/reactive/kotlinx-coroutines-rx2/test/ObservableSourceAsFlowStressTest.kt
@@ -0,0 +1,89 @@
+/*
+ * Copyright 2016-2018 JetBrains s.r.o. Use of this source code is governed by the Apache 2.0 license.
+ */
+
+package kotlinx.coroutines.rx2
+
+import io.reactivex.*
+import io.reactivex.exceptions.*
+import kotlinx.coroutines.*
+import kotlinx.coroutines.flow.*
+import org.junit.*
+import java.util.concurrent.*
+
+class ObservableSourceAsFlowStressTest : TestBase() {
+
+    private val maxIterations = 25
+    private val collectorJobCancelDelay = 1_000L
+    private val nextIterationDelay = collectorJobCancelDelay * 2
+
+    private var jobCancelledException: Throwable? = null
+    private val exceptionHandler = { throwable: Throwable ->
+        jobCancelledException = extractJobCancelledException(throwable)
+    }
+
+    @Before
+    fun setup() {
+        ignoreLostThreads("RxComputationThreadPool-", "RxCachedWorkerPoolEvictor-", "RxSchedulerPurge-")
+    }
+
+    @Test
+    fun testObservableSourceAsFlow_doesntThrowJobCancelledException() = withExceptionHandler(exceptionHandler) {
+        val collectorThread = newSingleThreadContext("Collector Thread")
+        val cancellerThread = newSingleThreadContext("Canceller Thread")
+        val scope = CoroutineScope(Job())
+        var iteration = 0
+
+        while (jobCancelledException == null && iteration < maxIterations) {
+            scope.runIteration(collectorThread, cancellerThread)
+            iteration += 1
+
+            Thread.sleep(nextIterationDelay)
+
+            collectorThread.cancel()
+            cancellerThread.cancel()
+        }
+
+        collectorThread.close()
+        cancellerThread.close()
+        scope.cancel()
+
+        jobCancelledException?.also {
+            throw error("ObservableSource.asFlow() cancellation caused exception in iteration # $iteration", it)
+        }
+    }
+
+    private fun CoroutineScope.runIteration(
+        collectorThread: ExecutorCoroutineDispatcher,
+        cancellerThread: ExecutorCoroutineDispatcher
+    ) {
+        val outerObservable = Observable.interval(1L, TimeUnit.MILLISECONDS)
+        val innerObservable = Observable.interval(1L, TimeUnit.MILLISECONDS)
+
+        val collectorJob = launch(collectorThread) {
+            outerObservable
+                .asFlow()
+                .flatMapLatest {
+                    innerObservable.asFlow()
+                }
+                .collect { delay(100) }
+        }
+
+        launch(cancellerThread) {
+            delay(collectorJobCancelDelay)
+            collectorJob.cancel()
+        }
+    }
+
+    private fun extractJobCancelledException(throwable: Throwable): Throwable? {
+        if (throwable is UndeliverableException) {
+            if (throwable.cause !is InterruptedException) return throwable.cause
+        }
+
+        if (throwable is InterruptedException) {
+            if (throwable.cause !is InterruptedException) return throwable.cause
+        }
+
+        return throwable
+    }
+}
diff --git a/reactive/kotlinx-coroutines-rx3/src/RxConvert.kt b/reactive/kotlinx-coroutines-rx3/src/RxConvert.kt
index 9bb38c088f..f30146a704 100644
--- a/reactive/kotlinx-coroutines-rx3/src/RxConvert.kt
+++ b/reactive/kotlinx-coroutines-rx3/src/RxConvert.kt
@@ -81,7 +81,12 @@ public fun <T: Any> ObservableSource<T>.asFlow(): Flow<T> = callbackFlow {
     val observer = object : Observer<T> {
         override fun onComplete() { close() }
         override fun onSubscribe(d: Disposable) { if (!disposableRef.compareAndSet(null, d)) d.dispose() }
-        override fun onNext(t: T) { sendBlocking(t) }
+        override fun onNext(t: T) {
+            try {
+                sendBlocking(t)
+            } catch (ignored: Throwable) { //TODO: Replace when this issue is fixed: https://github.com/Kotlin/kotlinx.coroutines/issues/974
+            }
+        }
         override fun onError(e: Throwable) { close(e) }
     }
 
diff --git a/reactive/kotlinx-coroutines-rx3/test/ObservableSourceAsFlowStressTest.kt b/reactive/kotlinx-coroutines-rx3/test/ObservableSourceAsFlowStressTest.kt
new file mode 100644
index 0000000000..b5e90286a4
--- /dev/null
+++ b/reactive/kotlinx-coroutines-rx3/test/ObservableSourceAsFlowStressTest.kt
@@ -0,0 +1,89 @@
+/*
+ * Copyright 2016-2018 JetBrains s.r.o. Use of this source code is governed by the Apache 2.0 license.
+ */
+
+package kotlinx.coroutines.rx3
+
+import io.reactivex.rxjava3.core.*
+import io.reactivex.rxjava3.exceptions.*
+import kotlinx.coroutines.*
+import kotlinx.coroutines.flow.*
+import org.junit.*
+import java.util.concurrent.*
+
+class ObservableSourceAsFlowStressTest : TestBase() {
+
+    private val maxIterations = 25
+    private val collectorJobCancelDelay = 1_000L
+    private val nextIterationDelay = collectorJobCancelDelay * 2
+
+    private var jobCancelledException: Throwable? = null
+    private val exceptionHandler = { throwable: Throwable ->
+        jobCancelledException = extractJobCancelledException(throwable)
+    }
+
+    @Before
+    fun setup() {
+        ignoreLostThreads("RxComputationThreadPool-", "RxCachedWorkerPoolEvictor-", "RxSchedulerPurge-")
+    }
+
+    @Test
+    fun testObservableSourceAsFlow_doesntThrowJobCancelledException() = withExceptionHandler(exceptionHandler) {
+        val collectorThread = newSingleThreadContext("Collector Thread")
+        val cancellerThread = newSingleThreadContext("Canceller Thread")
+        val scope = CoroutineScope(Job())
+        var iteration = 0
+
+        while (jobCancelledException == null && iteration < maxIterations) {
+            scope.runIteration(collectorThread, cancellerThread)
+            iteration += 1
+
+            Thread.sleep(nextIterationDelay)
+
+            collectorThread.cancel()
+            cancellerThread.cancel()
+        }
+
+        collectorThread.close()
+        cancellerThread.close()
+        scope.cancel()
+
+        jobCancelledException?.also {
+            throw error("ObservableSource.asFlow() cancellation caused exception in iteration # $iteration", it)
+        }
+    }
+
+    private fun CoroutineScope.runIteration(
+        collectorThread: ExecutorCoroutineDispatcher,
+        cancellerThread: ExecutorCoroutineDispatcher
+    ) {
+        val outerObservable = Observable.interval(1L, TimeUnit.MILLISECONDS)
+        val innerObservable = Observable.interval(1L, TimeUnit.MILLISECONDS)
+
+        val collectorJob = launch(collectorThread) {
+            outerObservable
+                .asFlow()
+                .flatMapLatest {
+                    innerObservable.asFlow()
+                }
+                .collect { delay(100) }
+        }
+
+        launch(cancellerThread) {
+            delay(collectorJobCancelDelay)
+            collectorJob.cancel()
+        }
+    }
+
+    private fun extractJobCancelledException(throwable: Throwable): Throwable? {
+        if (throwable is UndeliverableException) {
+            if (throwable.cause !is InterruptedException) return throwable.cause
+        }
+
+        if (throwable is InterruptedException) {
+            if (throwable.cause !is InterruptedException) return throwable.cause
+        }
+
+        return throwable
+    }
+}